GW shares down as Sativex fails to meet target

Shares in British company GW Pharmaceuticals have plummeted after one of its pioneering cannabis-based painkillers failed to meet statistical targets during clinical trials

Shares in British company GW Pharmaceuticals have plummeted after one of its pioneering cannabis-based painkillers failed to meet statistical targets during clinical trials.

Reuters reported on April 8 that shares in GW fell by almost 31 per cent to a four-month low of 49 pence. The share price has since rebounded by 10 per cent.

Sativex, which is being developed to treat central neuropathic pain caused by multiple sclerosis (MS), did not produce a high enough rate of pain reduction in 339 patients in the phase III double-blind placebo-controlled study. It was branded as GW's frontrunner cannabinoid medication with people hopeful for its future but failure at the clinical trial stage has proven a huge setback for the UK based pharmaceutical company.

Paul Cuddon, an analyst for KBC Peel Hunt, said: "If you look at the share price, it had risen 100 per cent in the three months prior to this announcement with people fully expecting it [Sativex] to work."

"It was essentially a repeat of a trial, which has proven highly significant in the past, and the fact that this one showed no significance at all for the primary outcome was just a bit disappointing to people really," Cuddon added referring to the results of the clinical phase III study.

Although 50 per cent of the patients being treated with Sativex during the trials experienced a 30 per cent pain reduction, the placebo response was unexpectedly high. Subsequently the drug failed to meet stipulated significant statistical targets during the study.

Dr Stephen Wright, GW R&D director, said: "It is frustrating that the extent of the placebo response has narrowly prevented the benefits seen on Sativex translating into a statistically significant outcome."

Sativex is currently being assessed in two other 2008 studies (phase III trials), one of which is to test its efficacy in treatment of MS Spasticity. The Medicines and Healthcare products Regulatory Agency (MHRA) requested this trial in 2007 and its hoped results will be available later in 2008.

Cuddon said: "I don't think people will be buying into the company on the assumption that those trials are going to come out positive because we fully expected this one to be positive."

But a spokesman for GW explained that the Sativex trial was unduly affected by the high placebo response that was caused by the design of the painkiller, which is administered as an oral spray so patients can decide how much they need. GW discovered at the end of 2007, half way through the phase III study, that patients were taking much higher doses of the placebo. According to the GW spokesman, this was the main factor in the disparity of the results released today.

Mark Rogerson, spokesman for GW pharmaceuticals, said: "With the approval of the regulator [MHRA] we changed the precise design of the neuropathic pain trial but not in time and hence we've got the data that we published today."

"The good news is that the more recent spasticity trial, which we started earlier this year, and the cancer pain trial we started in the US, have had the placebo effect designed out of them," he added.

Dr Stuart Ratcliffe, principal investigator of the study and more recently the director of the Pain Research Group at St Bartholomew's and the Royal London Hospital NHS Trust, said: "My experience with Sativex continues to show that it is an extremely helpful medicine for these high need patients and I am confident that the ongoing trials, which seek to address the placebo issue, will demonstrate its value."